When repair costs start to exceed the value of the vehicle or one-year monthly payments for a replacement, it's time to say goodbye to your car. This is according to automotive site Edmunds and Consumer Reports, the product review site. In other words, you're spending so much money that you could buy a used version of your current car that actually works instead of fixing your broken car. But how do you know when it's time to break up with your car? The first step is to consider the cost of repairs versus the cost of a new car.
If repair costs are higher than this full year of car payments, then you might want to reconsider repairs. You should also think about how much you could save at the pump if you switched your car to a more fuel-efficient model. Another factor to consider is the value of your car. You can search listings for the same vehicle or look up your car in Kelley Blue Book to get a rough estimate of its value.
If the value of your car is lower than what you would pay for a new one, then it might be time to say goodbye. Finally, if you have the skills and knowledge, you can try selling your car for parts. This requires a lot more time and knowledge, but you'll earn more than a junkyard will pay you for the car. When it comes down to it, there are two main options when your car isn't worth repairing: fix your car and drive it forever, or buy the best car on the market.
However, money isn't the only thing you should consider when making this decision. Career transition can leave you without income for several months or more, depending on how long you are out of work. Use this car affordability calculator to determine the purchase price of the vehicle you can pay with your trade-in. At the end of the day, deciding whether or not to repair or replace your car is a personal decision that depends on many factors.
Consider all of these factors before making a decision and don't forget to use resources like Kelley Blue Book and Edmunds to help make an informed decision.